We've noted that pensions aren't bailing out on hedge funds and private equity funds. In fact, they continue to embrace them. That has made life a little more of an adventure for some pension overseers. Portfolio profiles Bill Clark, who oversees a $77 billion investment portfolio for New Jersey workers. In search of higher returns, the fund voted to diversify out of stocks and bonds and into alternatives. It has a goal of 19 percent in such vehicles; it's at about 12 percent now. But what has really put Clark "out there" was the decision to invest in Merrill Lynch, Lehman Brothers and Citigroup--only to watch them all tank. The Merrill deal fortunately came with some anti-dilutive provisions that have kept the state from taking a big bath. Clark remains undeterred. His search for alpha continues, though you have to wonder if at some point people in New Jersey will grow uncomfortable.  

For more:
- here's the Portfolio article